CRIME [Fwd: FW: NYTimes.com Article: Domestic Security: The Line Starts Here]

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    Domestic Security: The Line Starts Here
    
    April 6, 2003
    By PHILIP SHENON 
    
    
    
    
     
    
    WASHINGTON 
    
    ONLY three months in town, and Charles E. McQueary has
    found himself just about the most popular man in wartime
    Washington. Powerful lobbyists and corporate executives
    track down his new telephone number and call him
    unannounced; strangers buttonhole him in the halls of
    Congress, hoping for a few precious minutes of his time. 
    
    Dr. McQueary, a former executive of General Dynamics and
    Bell Laboratories, is the newly confirmed undersecretary
    for science and technology in the Department of Homeland
    Security. In that job, he will influence how the giant new
    agency and the rest of the federal government spend tens of
    billions of dollars on technology to defend American soil
    from terrorist attacks. 
    
    A genial, Texas-born engineering Ph.D., Dr. McQueary is now
    the government's chief contact with the scientists,
    technicians and entrepreneurs who are searching for ways to
    help their companies profit from the public's
    understandable fixation with keeping their families and
    communities safe from terrorism - a threat that probably
    has grown as a result of the war with Iraq. 
    
    Dr. McQueary got a taste of his newfound celebrity when,
    seconds after he finished testifying at his Senate
    confirmation hearing last month, he was approached in the
    hearing room by an entrepreneur who wanted to promote
    data-mining software that might help in the government's
    hunt for terrorists. 
    
    "I gave him an e-mail address," said Dr. McQueary, who has
    established a special e-mail account for dealing with the
    sudden crush of lobbyists, corporate executives and
    hand-to-mouth entrepreneurs who want to pitch their
    domestic-security wares. (science.technology@private). 
    
    "Through my whole professional career, I always answered my
    own telephone, but it's rapidly getting to the point where
    that's not feasible anymore," said Dr. McQueary, who says
    he is more excited than beleaguered by his assignment. "I
    don't know if inundated is the right word, but we certainly
    are hearing from a number of people with ideas. And some of
    them are very good ideas." 
    
    The domestic-security industry may be new, a legacy of the
    Sept. 11, 2001, terrorist attacks and the widespread fear
    among intelligence agencies that Americans will be a
    central terrorist target for years to come. 
    
    But most components of the industry are well established;
    the largest players include major military contractors,
    giant electronics makers and private security companies
    looking for new markets for their expertise. 
    
      
    HOWEVER defined, the domestic-security market is huge - and
    growing. There are as many different sales forecasts for
    the industry as there are research groups doing the
    estimating. But all of the industry's multibillion-dollar
    forecasts are bullish. 
    
    An industry-supported institute called the Homeland
    Security Research Corporation, in San Jose, Calif.,
    predicts that overall public and private spending on
    domestic security will jump to $120 billion to $180 billion
    in 2008 from $65 billion this year. 
    
    Another trade group, the Government Electronics and
    Information Technology Association of Arlington, Va., says
    its tabulation shows that federal spending on
    domestic-security technology will reach $13 billion in the
    current fiscal year and rise to $14.6 billion in the 2008
    fiscal year, a figure that does not include inflation. 
    
    Critics have said the Bush administration is devoting too
    little money to the Department of Homeland Security, the
    new superdepartment that is consolidating the work of 22
    federal agencies. The White House is seeking an overall
    budget for the department of about $38 billion next year, a
    7 percent increase. 
    
    Lawmakers from both parties seem determined to spend
    billions more on domestic security, especially given the
    renewed worries about terrorism threats, and the
    administration seems likely to bow to their pressure. 
    
    Beyond Washington, state and local governments face similar
    huge demands to increase security spending, as does private
    industry, which is confronted with billions of dollars a
    year in new security costs, especially for companies
    considered likely terrorist targets, like airlines,
    chemical manufacturers and nuclear power generators. 
    
    "The money is just beginning to flow," said Bruce Aitken, a
    Washington lawyer and lobbyist who is president of the
    Homeland Security Industries Association, a trade group
    that has signed up more than 100 companies as members since
    it was incorporated in July. They include the giant
    government contractors Lockheed Martin, General Dynamics,
    Bechtel and Fluor. 
    
    "We think that the United States is extremely vulnerable to
    terrorist attack," said Mr. Aitken, who is about to
    announce the establishment of a political action committee
    to promote the industry's interests on the campaign trail.
    "We've got a lot of weak links, and it's going to take a
    lot of money to get that changed." 
    
    No military contractor is as closely associated with the
    war in Iraq as Raytheon, which makes the Tomahawk and
    Patriot missile systems; the war began last month when
    dozens of Tomahawks slammed into targets in Baghdad. But
    the company, based in Lexington, Mass., is eager to be seen
    these days as the government contractor of choice when it
    comes to dealing with enemies who might strike closer to
    home. 
    
      
    WITHIN days of the terror attacks in September 2001,
    Raytheon announced Project Yankee, a companywide effort to
    determine how its military expertise and products might be
    converted to use in domestic counterterrorism. In June, the
    company took the next step, formally creating a new
    division based in Falls Church, Va., outside Washington, to
    oversee its domestic-security business. 
    
    Its first major product is now arriving on the market, a
    $250,000 command-and-control vehicle called the First
    Responder, which is a Chevy Suburban sport utility vehicle
    packed with communications equipment and antennas allowing
    emergency-response agencies to communicate with one another
    even if they use different radio frequencies. 
    
    Raytheon officials say that in a major terrorist attack,
    the vehicle would overcome some of the logistical problems
    that hampered the disaster scenes in Lower Manhattan and
    the Pentagon on Sept. 11, 2001, when emergency workers
    using different, incompatible communications equipment
    poured in to help from cities and towns hundreds of miles
    away. 
    
    "The First Responder is just coming off the assembly line,"
    said Dale Craig, a retired Army communications specialist
    who joined Raytheon after 30 years in the military; he is
    now directing the First Responder program. "This is a
    product whose time is here." 
    
    The first of the vehicles is bound for the Los Angeles
    County Sheriff's Department, and Raytheon said it was in
    negotiations with almost 300 potential buyers, including
    many police and fire departments around the country. 
    
    Another military contractor, Northrop Grumman, is working
    with a small high-technology company in Bedford, N.H.,
    Imaging Automation, to promote security systems that would
    allow the federal government to quickly authenticate
    passports, visas and other documents presented at security
    checkpoints. 
    
    The Imaging Automation system, which uses a small glass-top
    metal box on which a document can be scanned in seconds for
    signs of forgery, has already been sold to the governments
    of Hungary and Australia, to the British airports authority
    and to Logan Airport in Boston, where it is used to verify
    documents presented by potential employees. 
    
    Imaging Automation, which has 60 employees, is a private
    company and does not release its financial results. But
    Bill Thalheimer, the chief executive, said he expected
    sales to double this year over last, and to triple next
    year from this year. "And that's all exclusive of what the
    federal government might want to do," he said. 
    
    In an age of terrorist threats and fears, the opportunities
    of the market reach beyond high technology, and companies
    that make basic home security and alarm systems are also
    poised to benefit. 
    
    Anyone who visited a supermarket or hardware store in early
    February, when the White House raised the color-coded
    terrorism alert and urged the public to stock up on basic
    survival supplies, understands that American families are
    willing to spend freely on their own protection. 
    
    After a year of corporate scandal and criminal charges
    against executives, the employees of Tyco International
    were probably entitled to a little good news, and they got
    it as a result of the February alert. Tyco is one of the
    world's largest makers of duct tape, and demand was so
    strong for its Nashua-brand tape that it switched the
    production line at its Kentucky plant to making residential
    duct tape instead of the commercial variety. 
    
      
    WHILE much of the early business of the Department of
    Homeland Security seems likely to go to large government
    contractors that have the track record and lobbying muscle
    to make themselves quickly known to the new agency, the
    department says it wants to serve as an incubator to
    innovative small and midsize companies. 
    
    "We're going to find there are some real good ideas from
    small companies," said Dr. McQueary, who is expected to
    spend much of his first several months at the department
    deciding on technology to help secure border checkpoints to
    block the entry of terrorists and their weapons. 
    
    He said he was trying to set aside time each week to meet
    with small, creative inventors who had domestic-security
    ideas that big contractors might have overlooked. "I had an
    individual come by to see me the other day with an idea for
    a secure manhole cover," Dr. McQueary said. "I was happy to
    give him 15 minutes. It's a manhole cover that couldn't be
    easily lifted out of its recess, and so terrorists couldn't
    easily get in and hide. Not a bad idea."  
    
    
    http://www.nytimes.com/2003/04/06/business/yourmoney/06LOBB.html?
    ex=1050754225&ei=1&en=d44eb7b2099f5f51
    
    
    
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